We are focused on the gaming market in the UK and Spain and have four key strengths to help future growth:
GAME Digital plc (“GAME” or the “Group”) today announces its interim results for the 26 week period ended 28 January 2017 (the “period”). All comparator periods are for the 26 weeks ended 23 January 2016 unless otherwise stated.
26 weeks ended
28 January 2017
26 weeks ended
23 January 2016
Gross profit margin
Profit before tax
Profit before tax – Core Retail
Loss before tax – Events, Esports and Digital
Net cash from operating activities
Basic earnings per share
Interim dividend per share
Selected non-IFRS measures
Gross Transaction Value (GTV)1
GTV excluding Hardware
GTV of New retail categories2
GTV of Events, Esports & Digital
Adjusted EBITDA3– Group
Adjusted EBITDA – Core Retail
Adjusted profit before tax4
Financial and Operational Headlines
Martyn Gibbs, Chief Executive Officer, said:
“We delivered a strong performance in digital and new VR technology, however our first half saw another tough period for console hardware and physical software sales in the UK, impacted by a weaker line-up of new games launches and the market-wide underperformance of certain key titles. Together, these dynamics resulted in a disappointing performance from our UK retail operations, however our Spanish operations and new business areas delivered further growth.
“We continue to prioritise our efforts on taking the necessary actions to respond to these challenges, whilst positioning the business to capitalise on major future market opportunities. Across the Group we are working hard to improve operational efficiencies and reduce costs whilst implementing our GAME Changing strategy to reposition and transform the business, and I am encouraged with the progress we are making.
“We delivered another positive performance across our focus retail categories in the half, including digital content, preowned tech, and PC gaming. We also made significant progress developing our live in-store gaming proposition under our new BELONG™ brand, with encouraging results from the first seven arenas, and as a result we are accelerating our investment and implementation of this initiative. Overall we more than doubled sales from our growing Events, Esports and Digital activities.
“We have been pleased with the positive trading performance delivered in the first few weeks of the second half. Although we expect industry-wide challenges in our core Xbox and PlayStation categories to continue, we anticipate the overall UK market to remain positive during the rest of 2017, underpinned by the successful launch and continued consumer demand for the Nintendo Switch™, the planned launch of Xbox Project Scorpio and a stronger slate of new titles later in the year.”
Whilst market wide activity trends seen in the first half have continued into the early part of our second half, the launch of the Nintendo Switch™ has, as with most new console launches, brought positive impetus and growth to the whole games market.
The total Retail mint market in the UK for the first seven weeks of the second half was 22% up compared to the equivalent period last year with our UK Retail GTV up 7% over the same period. In Spain the total mint market was up 51% compared to the equivalent period in H2 last year, with Game Spain’s GTV up 38% in local currency during the first seven weeks of the half. This growth is largely explained by the successful launch of Nintendo SwitchTM in both markets and going forwards this positive momentum will be highly dependent on stock availability.
The Group expects to deliver continued growth from digital and other new retail categories in the second half, as well as across Events, Esports and Digital, with these business areas delivering a growing contribution to Group gross profit. Furthermore, we currently anticipate an overall positive sales performance for the second half with the sales of Nintendo Switch™, together with our other sales initiatives to offset the declines expected in Xbox and PlayStation console markets.
Looking further ahead, further supportive market developments are expected in the first half of the next financial year, with the launch of Microsoft’s Project Scorpio and several major new game titles already announced, including Red Dead Redemption 2 and Super Mario Odyssey.
The Board will announce its full year results for the 52 weeks ending 29 July 2017 in October 2017.
Management will be hosting a presentation for analysts and investors at 9.30 a.m. today at Citigate Dewe Rogerson, 3 London Wall Buildings, London Wall, EC2M 5SY. A live audio webcast of the presentation will be available via the Company’s website at www.gamedigitalplc.com/investor-relations. A recording of the presentation will be made available on www.gamedigitalplc.com later today.
The information contained within this announcement is deemed to constitute inside information as stipulated under the Market Abuse Regulations (EU) No. 596/2014 (“MAR”). Upon the publication of this announcement this inside information is now considered to be in the public domain.
+44 (0) 1256 784 000
Chief Executive Officer
Chief Financial Officer
Investor Relations & Corporate Development Director
Citigate Dewe Rogerson
+44 (0) 20 7638 9571
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